Metsä Board Posts €45.6 Million Operating Loss in Third Quarter 2025

Finnish packaging producer Metsä Board reported a comparable operating loss of €45.6 million for the third quarter of 2025, reversing the €41.9 million profit booked in the same period a year earlier. The swing into negative territory reflects lower sales, diminished paperboard deliveries and continued weakness in European and Asian pulp markets.

Net sales fell 11.6% to €441.2 million from €499 million in the third quarter of 2024. Paperboard shipments declined to 332,000 tonnes, down 56,000 tonnes year on year. Average sales prices for paperboard remained broadly unchanged from the prior quarter, but soft consumer demand, excess industry capacity and U.S. tariffs pressured volumes and margins.

Despite the operating loss, Metsä Board generated positive cash from operations. Net operating cash flow climbed to €122 million, compared with €4.6 million a year earlier, largely because working-capital releases totaled approximately €120 million during the period. Management plans to free an additional €150 million of working capital by the end of 2025.

To conserve cash, the company curtailed production of paperboard, bleached chemi-thermomechanical pulp (BCTMP) and market pulp. Output was further restricted by an annual maintenance shutdown at the Husum integrated mill in Sweden and an investment-related shutdown of the Simpele board machine in Finland. These interruptions weighed on both production volumes and profitability for the quarter.

The pulp segment delivered particularly weak results. Demand in Europe and China remained subdued, and market prices continued to fall. Production at associated company Metsä Fibre’s Joutseno mill in Finland has been suspended since June, a pause that has now lasted four months. Metsä Board said the overall pulp contribution was “clearly negative” for the July-to-September period.

In response to prolonged market headwinds, the board launched a cost-saving and profitability program intended to raise its earnings-before-interest, taxes, depreciation and amortization (EBITDA) run rate by €200 million by the end of 2027. Management indicated that the initiative progressed as planned during the third quarter.

No specific operating-result guidance was provided for the coming quarters. However, the company expects cash flow from operations to remain positive and anticipates a slight seasonal decrease in paperboard deliveries in the final quarter of the year. Results for October-to-December 2025 may also include insurance proceeds related to two incidents at Metsä Fibre facilities: a gas explosion at the Äänekoski bioproduct mill in spring 2024 and recovery-boiler damage recorded in autumn 2024.

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Looking further ahead, Metsä Board said falling pulpwood prices in Finland and Sweden should begin to support profitability from 2026. Exchange-rate movements, including the effects of currency hedges, are projected to have a slightly negative impact on fourth-quarter 2025 earnings and a clearly negative impact on the first quarter of 2026.

Chief Executive Esa Kaikkonen characterized the business environment as challenging. He noted that elevated pulpwood costs and a weak U.S. dollar are eroding the competitiveness of European paperboard and pulp producers, including Metsä Board. The company intends to concentrate on factors within its control, such as cost reductions, working-capital management and disciplined investment.

World Trade Organization data indicate that U.S. duties on certain paperboard and softwood products remain in effect, adding pressure to European exporters and complicating recovery prospects in key overseas markets.

Crédito da imagem: Metsä Board